Grays Harbor Public Utility District (PUD) recently received a $50,000 Washington state grant to conduct a feasibility study in order to determine the best route for expansion of their open access broadband infrastructure into Oakville and the Chehalis Indian Reservation. Both areas are considered underserved and some areas in the region have no Internet service available to residents or businesses.

The Reasons Are There

The Commerce Department’s Public Works Board awarded the $50,000 grant and eight other grants for eight other feasibility studies around the state. The funds will likely pay for the entire study and, according to director of PUD Core Service Rod Hanny, will determine the best route for a fiber line and identify "right-of-way issues, permitting requirements, construction costs, and whether the project would fit the needs of the communities and the utility itself."

Officials at the PUD say that they've received many requests from residents and businesses in the area to establish fiber infrastructure for Internet access. The PUD also wants to put fiber in place in order to improve other utility operations. Currently a substation in the area is monitored via satellite and a fiber connection would be create a more reliable method of communication. If the feasibility study reveals that a project would be a beneficial investment for the region, the project would take roughly a year to complete.

New York City has been looking for a way to address Internet access disparities - quality, pricing, and infrastructure investment - for years. Their New York City Internet Master Plan from the Mayor's Office of the Chief Technology Officer, released today, recognizes that the current market solution has failed "The Big Apple" and its residents. In order to move forward and to extend broadband to all New Yorkers, the city will take a more active role, which will include open access fiber optic infrastructure and nurturing private sector investment.

Read the New York City Internet Master Plan here.

The Market Failure

The highly-anticipated report, which we hope to cover more in-depth after we've had more time to dig deeper into its 88 pages, describes the breadth of the problem and digs into why New York's Internet access availability is fraught with so much disparity. Other urban centers that struggle with similar digital disparities can use this groundbreaking approach as a foundation to study their own communities and search for a way to bring broadband to everyone.

From the Executive Summary:

The private market has failed to deliver the Internet in a way that works for all New Yorkers. Citywide, 29 percent of households do not have a broadband subscription at home. The same percentage of households are without a mobile broadband connection. The substantial overlap between these under-connected populations means that 18 percent of residents – more than 1.5 million New Yorkers – have neither a mobile connection nor a home broadband connection.

The report notes that the millions of New Yorkers who are not connected also tend to be those from lower-income households who don't have broadband at home. Competition tends to be only in high-density neighborhoods with high income households, which needs to change. The report accentuates the correlation between income levels and disparities in broadband service with striking maps.

Open access networks offer opportunities for competition and innovation that networks owned and operated by one entity can’t provide. We've written about open access networks owned, operated, and funded by public entities; now private investors are increasingly attracted to these competitive, fiber optic environments.

Changing Paradigm

Over time, American Internet access subscribers have become accustomed to the idea that options are limited because large, corporate Internet access providers have positioned themselves so as not to compete with one other. In areas where local communities have deployed open access models, such as in Ammon, Idaho, or in places with regional open access networks, like UTOPIA Fiber in Utah and the many Public Utility District networks (PUDs) in the state of Washington, those connecting to the network have benefitted from ISP choice and access to high-quality connectivity.

In Europe and Asia, open access models appear more regularly, but in the U.S., the open access arrangement has primarily been adopted by local governments offering wholesale service to ISPs. Often they do so as a way to comport with state law. In the past few years, however, private companies and investment firms have seen the potential of open access fiber optic infrastructure in the U.S. For example, SiFi Networks announced a project in Fullerton, California, earlier this year with plans to establish similar infrastructure projects in other communities.

We recently touched base with Kelly Ryan, CEO of iFiber Communications, an Internet service provider that operates via open access networks owned and operated by PUDs in Washington. We also talked with James Wagar, Managing Director of Thomas Capital Group, who has eyes on open access fiber optic network projects.

The Finance Piece

Eugene, Oregon’s publicly owned EUGNet is helping create jobs and fill empty office buildings in downtown Eugene, reports KMTR Channel 16.

Gigabit connectivity from service providers operating via the city’s dark fiber infrastructure are charging around $79 per month, allowing more interest in downtown locations and better economics for local entrepreneurs. 

This makes it a game-changer for software firms, graphic art firms, medical- just about anyone that handles large amounts of data.

“Before we had EUGNet, we just couldn't do this product, it would be impossible,” said Pipeworks Studio Technical Director, Daniel White.

Since using the network, Pipeworks has grown tremendously. A faster network means more work and that increase in productivity has allowed them to hire 50 new employees.

“The door was always there, we just couldn't open it...but now you can. Yes, It allows us to do projects we couldn't have done before, it's very reasonably priced... it's super reliable,” said White.

Vacancy in the downtown district has dropped from ten percent to seven percent since 2017.

“The economic impacts from this project are everything we thought they would be and I think even more.,” said City of Eugene Economics Strategies Manager, Anne Fifield, “We have seen the cost of Internet service really come down and service levels go up.”

Watch local reporting on the results of Eugene's fiber optic network investment:

Idaho Falls completed a publicly owned and operated a dark fiber network in 2010. Recently, city leaders unanimously decided to use the asset to offer citywide Internet access to the community. The vote followed a successful pilot project, commenced in March and completed this past September, which connected around 1,200 homes.

According to the East Idaho News:

Since that time, Idaho Falls Fiber officials have been gathering data and evaluating the costs and feasibility of expanding the high-speed fiber network through the rest of the Idaho Falls community.

...

“This kind of a public-private partnership is exciting. It allows the city to focus on infrastructure—something we excel at,” said Idaho Falls Mayor Rebecca Casper. “And, it allows local Internet providers to offer their internet services to residents where they previously could not get this type of infrastructure to deliver a reliable high speed Internet product. It captures the best of both worlds.”

Idaho Falls worked with UTOPIA Fiber on the pilot project, which included four local Internet access providers offering services via the Idaho Falls publicly owned fiber optic infrastructure. The open access network will continue to expand over the next four years within the Idaho Falls Power service area. UTOPIA Fiber will continue to work with the city to expand the network.

“Designing a system like this is a complicated operational and engineering function,” said [General Manager Bear] Prairie. “That’s why the Council approved the agreement for us to partner with UTOPIA Fiber, a not-for profit entity like Idaho Falls Fiber that has the experience in operating successful networks similar to our design. We are excited to have successfully demonstrated that utilizing our existing power utility infrastructure to install fiber lines coupled with UTOPIA’s software that opens the network to local Internet providers to use has proven to be an economic success for our city.”

Quincy, Massachusetts, recently let the public know that they're serious about encouraging local Internet access competition through public investment. At an October 21st press conference, Mayor Thomas Koch and City Council Member Ian Cain announced that the largest city in Norfolk County will begin gathering data on local interest in a municipal Fiber-to-the-Home (FTTH) network.

The Choice That Isn't a Choice

With Comcast as the only option for broadband Internet access, leaders such as Cain feel that it's time to encourage competition. DSL is available, but the average speed in the Quincy area is slower than 10 Megabits per second (Mbps) download. Upload speeds are likely around 1 Mbps -- hardly the kind of connectivity a community of 94,000 want to boast about.

Limited fiber for commercial subscribers has been deployed in the city, but without more options, Quincy faces a disadvantage as communities around them invest in better connectivity. The Mayor, Cain, and other local leaders have economic development on their minds when considering the initiative. Cain told press conference attendees, "This is a way to really have Quincy stand out in a way that other cities and towns aren't really looking at. This is a way to put us up front," as a way to attract more businesses.

Cain noted that comments from constituents regarding poor Internet access in Quincy have come to his office for the past five years. In 2018, the city council adopted Cain's resolution to investigate the possibility of publicly owned Internet network infrastructure. Residents have also taken their complaints to the Mayor. At the press conference, Koch said:

“I hear constantly from people about lack of competition – some related to cable, some related to slowness of access to get onto the network. This is something we’re very serious about looking at.”

Ammon, Idaho, got our attention years ago but as benefits from the city’s publicly owned fiber optic infrastructure continue to grow, others are taking notice. Most recently, contributing editor at Fast Company, Jay Woodruff wrote about the community’s investment in Fast Company's “The New Capitalism” series. 

Woodruff notes that Ammon, with only about 16,500 people, has surpassed large cities in quality of connectivity and choice of Internet access providers. Woodruff quotes Bruce Patterson, Technology Director in Ammon: “If you were to ask me what the key component of Ammon is, I would say it’s a broadband infrastructure as a utility. We’ve just found a way to make it a true public infrastructure, like a road.”

Woodruff describes how the infrastructure is being integrated into the community’s larger development:

Residents of Ammon can choose to opt in to the network, which the city began building in 2011. Patterson expects that by the end of 2019, 900 of the town’s 4,500 residences will have joined the network. The city is growing, adding new residential addresses at a rate of about one per day, and Patterson says that every single developer is choosing to include the fiber infrastructure in new construction.

When asked what makes Ammon’s network better than other options available in communities such as New York and San Francisco, Patterson offered four factors:

PUBLIC UTILITY: The city of Ammon manages the network the same way it handles water services or road maintenance. “If we could simply come to a point as a nation where we would say internet infrastructure is essential and we’re going to make sure that everybody has access to it,” Patterson says, “that would be a huge step forward.”